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S = $/0.75; 1-year bond rate in UK= 5%; 1-year F = $/0.77; 1-year bond rate US= 2% a. Calculate the return on $1 invested
S = $/0.75; 1-year bond rate in UK= 5%; 1-year F = $/0.77; 1-year bond rate US= 2%
a. Calculate the return on $1 invested in the UK. Where will global investors choose to invest?
b. Find the Spot rate that makes the return on investments equal across these two countries?
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Finance For Non Financial Managers
Authors: Pierre G. Bergeron
5th Edition
0176104070, 9780176104078
